51
Match the following.
List-I List-II
a. Cost control purposes
1. . . . . . is a predetermined cost
b. Standard cost
2. Responsibility accounting fixes responsibility for . . . . .
c. Integrates
3. Cost accounting guides future . . . . .
d. Production policies
4. Budgeting system . . . . . key managerial
functions.
A)
a-4, b-3, c-2, d-1
B)
a-2, b-1, c-4, d-3
C)
a-2, b-3, c-4, d-1
D)
a-3, b-2, c-4, d-1
Answer & Solution
Answer: Option
B
52
The difference between fixed and variable cost has a special significance in the preparation of
A)
flexible budget
B)
master budget
C)
cash budget
D)
all of these
Answer & Solution
Answer: Option
A
53
Which of the following are direct expenses?
A)
Carriage outwards
B)
Carriage inward
C)
Both A and B
D)
None of these
Answer & Solution
Answer: Option
B
54
Cost of production report is
A)
production process report
B)
order sheet
C)
financial statement
D)
none of these
Answer & Solution
Answer: Option
A
A)
expenditure budget
B)
master budget
C)
functional budget
D)
cash budget
Answer & Solution
Answer: Option
C
56
Match the following.
List-I (Variances) List-II (Causes)
a. Overhead efficiency variance
1. Power failure
b. Overhead volume variance
2. Appointing low grade employees
c. Labour idle time variance
3. Poor working condition
d. Labour efficiency variance
4. Working days being more or less than budgeted
A)
a-4, b-3, c-2, d-1
B)
a-3, b-4, c-1, d-2
C)
a-3, b-1, c-4, d-2
D)
a-2, b-1, c-4, d-3
Answer & Solution
Answer: Option
B
57
An adverse labour efficiency variance together with a favourable labour rate variance may mean that
A)
less labour hours are needed to make the same amount of output
B)
the business is paying a higher hourly rate than the standard
C)
more products are being made per hour
D)
less skilled staff are being used in production
Answer & Solution
Answer: Option
D
58
Which of the following does not comprise of (Cost of Good Sold) COGS?
A)
Factory electricity expense
B)
Transportation for purchasing the raw material
C)
Electricity
D)
Sales, managers commission
Answer & Solution
Answer: Option
D
59
Which of the following is not a valid possible cause of direct materials quantity variances?
A)
Obtaining quantity discounts for large orders of materials
B)
Poor functioning of machinery giving rise to excessive wastage
C)
Better or worse quality of materials purchased
D)
Increased/decreased level of quality checks on the production process
Answer & Solution
Answer: Option
A
60
The margin of safety may be defined as
A)
the point at which break-even point sales are achieved
B)
the excess of planned sales over the current actual sales
C)
the extent to which sales revenue exceeds fixed costs
D)
the difference between planned sales and break-even point sales
Answer & Solution
Answer: Option
D
